Posts Tagged ‘Debt Deficits Obama Congress Repubilcans Democrats Liars Public Option Military Afghan War’

The Deficit of Truth and Ideas; The Surplus of Lies and Greed

In Current Events, Economics on November 22, 2010 at 02:26

The whining entreaties for belt tightening can be heard from Washington, D.C. like the cries of wailing babies yearning to suckle at mommy’s breast. We don’t like it, but we are forced to listen. The deficits upset us all, so we are compelled to act. Or are we? While we hear the cries of budget madness (where were these calls when Bush was President?), the government is continuing policies that bankrupt us financially and morally.

1. The Afghan War

The deadline for the end of the $12 billion dollar a month Afghan War was has been delayed from July 2011 until sometime in 2014. Let’s call it January 2014 for our purposes. That would be two and a half years, or 30 months longer, if THAT deadline holds. 30 x 12 leaves us with a cost of at least $360 billion (in less than 3 years) more for a war of choice that most Americans don’t want. Almost 6 in 10 Americans want to end the war, even with all the propaganda from Congress, the White House and most of the mass media about how this war is necessary. And 6 in 10 oppose the war even though there is almost no concerted anti-war effort like there was in the 60 and 70s against Vietnam.

So tell me Mr. President, Nobel Peace Prize Winner: Why do you want to stay in Afghanistan? Who’s pulling your strings? And Congress: Why do you keep funding a war and then pretending to care about the deficit?

2. Taxes

If you are going to ignore the billions of dollars of tax giveaways to the top 1% of earners, you should shut up about deficits. Taxing families over $250,000 in income and individuals with earning over $200,000 a year would put $70 billion dollars a year back into our budget. That is nearly half of the Bush tax cuts. The top bracket would go from 36% to 39.6%. Letting all tax cuts expire would put $157 billion per year to pay off the debt.

Republicans in Congress keep lying about how raising taxes will cost us jobs. There is no correlation between lower taxes and economic growth or employment. That is a myth perpetrated by politicians, mostly Republicans, who want to give corporations and wealthy individuals a free ride while punishing the unemployed.

If there was a benefit to the economy from tax cuts, the economy would be recording record growth and we would have full employment after 10 years of the Bush led tax cuts. But our economy is the worst it’s been for decades. And past times of high taxes, such as the 50s under Eisenhower, saw immense economic growth. But the media, Republicans, most Democrats, and much of the Washington establishment ignore the fact for a cultish hatred of taxes and the obsession with tax cuts.

“A review of American history makes the opposite case that conservatives would like it to make: high growth usually coincides with high taxes. During both world wars, taxes soared to record heights. And the supercharged economies that resulted produced high growth for decades afterwards.”(link)

Letting all the tax cuts expire, and ending the war in Afghanistan, would save almost one quarter ($301 billion dollars) of the estimated 2010 deficit of $1.3 trillion dollars. That would leave $1 trillion dollars of deficit. (link)

3. Cut military spending

The Sustainable Defense Taskforce formed by Democratic and Republican Congress members (including Barney Frank and Ron Paul) has looked at the defense budget and come up with over a trillion dollars of cuts. That would go a major way to cutting our current deficits. I agree with these cuts and am sure there could be more.

Table ES-3. Defense Reductions Associated with Restraint Strategy *

Strategic Capabilities

1. Nuclear arsenal (warheads)                                                             $100 b.

Ground Forces

2. Reduce the size of the Army                                                             $220 b.

3. Reduce the size of the Marine Corps                                                 $67 b.

Navy and Air Force

4. Build/operate fewer aircraft carriers and associated air wings             $43 b.

5. Operate fewer ballistic missile submarines (SSBNs)                         $4 b.

6. Build/operate fewer tactical submarines (SSNs/SSGNs)                         $34 b.

7. Build/operate fewer destroyers                                                             $28 b.

8. Build/operate fewer littoral combat ships                                                 $11 b.

9. Reduce the number of expeditionary strike groups                         $9 b.

10. Cancel the Maritime Prepositioning Force (Future)                         $17 b.

11. Build/operate fewer Air Force fighters                                                 $89 b.

Other Reforms, Procurement and RDT&E

12. Cancel Expeditionary Fighting Vehicle                                                 $11 b.

13. Terminate V-22 Osprey                                                                         $15 b.

14. Realign Missile Defense Program                                                 $60 b.

15. Cut Pentagon civilian workforce                                                             $105 b.

16. Reform Military Pay and Health Care                                                 $115 b.

17. Reform DoD Maintenance and Supply Systems                                     $13 b.

18. Reduce RDT&E                                                                                     $70 b.

19. Obtain Add’l Savings in Command, Support, and Infrastructure $100 b.

Total $1,111 b.

* This set of options was developed by Benjamin Friedman and Christopher Preble of the Cato
Institute. http://www.comw.org/pda/fulltext/1006SDTFreport.pdf

Those cuts address almost all of the cuts I would suggest. Additions would be to completely phase out the submarine fleet and aircraft carriers. Both are no longer needed for our strategic defense.

Unfortunately, most members of Congress are more concerned with reelection than the deficit, and they will ignore or slam these reasonable reductions in our bloated military.

So, between letting tax cuts expire, ending the war in Afghanistan, and making cuts in the military, we have saved $1,414,000,000, more than the current years projected deficit. Imagine that.

Certainly, winding down the Afghan War and ending certain procurement contracts would cost something. However, these cuts would eliminate most of the deficit.

Close Bases in Countries that won’t pay their share of their own defense.

The final bill: The United States spends approximately $250 billion annually to maintain troops, equipment, fleets, and bases overseas. Much of that $250 billion could be save by closing bases overseas and getting the countries taking US protection to foot the bill. If you are worried about security in say, South Korea, then keep those bases open. Otherwise, make the Germans, Israelis and Australians, etc, pay for the US presence. They can afford it.


A Public Health Care Option

The CBO and other organizations say a public option heath care system available to the government and others public and private sector employees would save about $7 billion a year in health care costs. But that won’t happen because protecting insurance company profits is more important than delivering health care at a reduced cost.

Everybody in the nation wants a public plan option. Both the NBC/WSJ poll and the NYT/CBS poll found overwhelming support, about 75%, for a public plan option.


Other Common Sense Cuts that We can Make

1. End the senseless war on drugs.

Treatment is the most cost effective way of dealing with deficits, but we continue to militarize the war on drugs at the cost of at least $40 billion every year, $15 billion from the federal government. Drug treatment is 7 times more cost effective. http://www.rand.org/publications/randreview/issues/RRR.spring95.crime/treatment.html So, for 1.5 billion dollars in federal drug treatment, we can have the same reduction of drug use equal to the current $15 billion spent. That is a savings of at least $10 billion.

$40 billion per year and climbing. In 2000, the National Drug Control budget exceeds $18 billion(1) and the states will spend upwards of $20 billion more.(2) This is a dramatic increase since 1980, when federal spending was roughly $1 billion and state spending just a few times that.(3) Between FY1991 and FY2000 more than $140 billion(4) has been spent at the federal level to curtail drug abuse, yet drugs remain cheap, easy to obtain and with higher purity levels than before the war on drugs was initiated.” http://www.drugpolicy.org/library/factsheets/economiccons/fact_economic.cfm

War on drugs clock for 2010:  http://www.drugsense.org/cms/wodclock

2. Competitive Drug pricing of Medicare and Medicaid patients could save $271 million a year for the system. This won’t happen because Congress relies on donations and jobs after Congress that big pharma provides them. But wouldn’t buying the same drugs cheaper be a good idea. It is the “free market” after all.

3. Cuts in operating budgets of all federal departments. Required a 10% budget cut in all U.S. departments, budget targeted at procurement, bureaucracy and overhead but NOT jobs unless there is replication in tasks. Benefits for citizens would also not be cut unless department head could show that the cuts would not harm citizens.

All workers would get first refusal of related work in other departments if they open. However, there would be an appeals process for department heads that can make a compelling case for NOT making the required cuts. Exceptions would include but not be limited to public safety and health.

End the Cut Social Security Limits and reduce SSI payouts to those with large pensions.
There is currently a Social Security tax exemption over $100,000 of income. That would mean you would not pay Social Security taxes over $100,000 of your income. To shore up the program, we must eliminate the caps and reduce payments to those with large yearly pensions. Twice the standard of living in pensions could be a cut off point for payments.  More research would be done before final levels would be set.

New Revenue Sources for The United States

1. Extend Unemployment Benefits. That will save jobs in many sectors and reduce other social costs. There will be a net gain from the extensions. “Further extending unemployment insurance benefits will generate over 700,000 full-time-equivalent jobs while saving millions from poverty” (link)

2. Tax off shore accounts held by U.S. taxpayers like onshore accounts are taxed.

3. Reduce or eliminate all tax deductions for capital gains and purchases while increasing tax cuts for job creation commensurate but less than tax revenues of new employees. Perhaps then billionaire bailout recipients will reinvest in jobs and not just line their pockets with GM and Apple stock if they had to pay taxes on capital gains.

4. Don’t allow property or companies owned for less than a year to be flipped without tax implications. Flipped property and companies will receive a sever tax penalty. This change would also go part way to reducing future housing bubbles.

Other Good Revenue Ideas of my Dreams
1. Tax on political ads. 100% tax on ads for political campaigns; for every dollar spent on Congressional, Gubernatorial and Presidential campaigns for ads would be taxed one dollar. The U.S. would have garnered about $5 billion in tax revenue this year.

2. Lobbyist tax—charge lobbyists on a sliding scale based on the number of people they represent. For example, lobbyist for Rupert Murdock would be charged $1billion dollars a year to operate in Washington, DC. Tea Party Lobbyists would be charged $1 million a year, union lobbyist $500,000 depending on the size of the union, and so forth. The more people you lobby for, the less you would have to pay to be a lobbyist. One could determine that by looking at who pays the bills. Industry lobbyists would be charged based on the number of companies that control at least 10% of the market. So, big pharma would be about 5, and each would pay $200 million for access for EACH lobbyist.

3. The Media Party Pundit Tax—Media groups that hire current or former politicians for national office an appearance fee for each, about $100,000 a day. Thus, Fox News would pay in the millions, and MSNBC would pay $100,000 a day for Lawrence O’Donnell being on the air. There would be no payment after the pundit has been out of office for more than 10 years. Thus, Next Gingrich of Fox’s time is almost up.

4. The lying tax—There would be a fee of $100,000 for all overt lies told on the air in national news and pundit talk show broadcasts.  Omission of facts and subjective “facts” will not carry a fee. The fee will be double for all lies on political campaign ads.

Tex Shelters